HAYWARD — Another round of failed negotiations may spur teachers to call for their first work stoppage in more than a decade.

Because a settlement over compensation was not reached during Monday’s six-hour negotiation session with the district and a mediator, teachers can legally call for a strike.

But both sides did move on their original offers.

“The district believes this last, best and final offer of 8.6 percent is fair and reasonable to teachers while still maintaining a balanced budget,” said Superintendent Dale Vigil.

Hayward Unified changed its original offer of a 3 percent raise retroactive to July to a 7 percent increase effective this May, followed by a

1.6 percent raise in July. However, the last increase is contingent on district savings from a minimum of 60 teachers enrolling in an early retirement incentive.

Mercedes Faraj, Hayward Education Association vice president, was not satisfied by the offer.

“It’s insulting,” she said.

Faraj, who also heads the union’s bargaining team, announced the district’s latest offer to members and was met with “boos.”

Meanwhile, the association budged from its demands of a near-17 percent salary increase — equal to one recently given to top administrators — in two years.

The union is now seeking an 8.08 percent increase for this school yearand a 4 percent increase next school year. Their offer also includes a cost of living adjustment, which equates to 16.12 percent over two years.

Hayward Unified can either come to terms with the union or make its final offer. Vigil said the district will discuss the offers with the board of education within the next 10 days.

There are no more scheduled bargaining sessions, but sides are hopeful to come back to the table and reach an agreement to avert a strike.

The union will meet with its board of directors to discuss the next steps and a possible work stoppage, said Kathy Crummey, HEA president.

Crummey also said the association will give the district advance notice in the event a strike is called.

A nonbinding recommendation that the district consider a 5 percent increase retroactive to January 2007 was also released Monday by Bonnie Castrey, a neutral fact finder who earlier in the month met with each side.

The association rejected the recommendation, saying Castrey ignored several factors the union presented during the fact-finding hearing.

In her recommendation, Castrey recognized the district’s inability to pay teachers the raises they are asking for.

Declining enrollment, projected to continue over the next three years, has stifled district funding and will potentially force the district into deficit spending in the next two years. Those projections assumed the district’s original offer of a 3 percent pay increase for teachers.

To fund a near-17 percent increase for teachers, the district would have to deficit spend by about $3 million this year and about $18 million next school year, Castrey’s report said.

Furthermore, the report said Hayward Unified would have to make at least $30 million in program cuts to fund such an increase.

Officials have said that increase would bankrupt the district by January of next school year.

The projections haven’t stopped teachers — who say they are paid less than teachers in comparable unified districts such as Pleasanton, Fremont and New Haven — from demanding what they say they are owed after voluntarily deferring raises in the past to help the district, which has had several years of state fiscal oversight, reshape its budget.

Teachers don’t buy the district’s “lack of resources” argument and have said the projections are being used as a “scare tactic.”

The sides have been working on an agreement since August.

Informational picketing will be held by teachers at all school sites and the district office today before school is in session.

Hayward teachers were last on strike in fall 1994 for six days. Before that, a two-day strike was held in November 1993 and a strike for one day was held in May 1973.

HEA represents more than 1,300 members in the district, which serves about 20,000 students.

The Hayward Unified School District has set up a hot line at (510) 784-2605 for parents to get updated information. The district’s Web site, http://www.husd.k12.ca.us, will also be updated regularly and officials encourage parents to visit the link on the home page titled “Parent and Guardian Labor Dispute Information.”